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Montreal produce purveyors fight foodservice slump

The Quebec government’s efforts to fight tax evasion in the restaurant industry may have contributed to a slump in sales.

“A lot of restaurants decided to close up at the beginning of the year,” said Benoit Lecavalier, former director of sales for Montreal-based foodservice specialist Hector Larivee.

“Numbers thrown out by the Quebec Restaurant Association show Montreal foodservice is down as much as 8% from last year, and for the province it’s 4% to 5%. As a company, we’re closer to 8%,” Lecavalier said.

Mike Bono, president of Montreal-based foodservice distributor Can Am, said his foodservice business is down about 4%, but he considers that good compared to the industry average.

“The box the government installed has slowed down business,” he said. “People are worried — it’s affecting our business a lot.”

Last November, the provincial government required restaurants to attach a micro-computer called an SRM (sales recording module) to their cash registers to record all sales. By law, every customer must also receive a receipt.

Revenue Quebec expects the new measures will allow the province to recover $300 million a year by 2019 by ensuring that owners report all income and pay all taxes due.

Gaetan Bono, president of organic distributor Gaetan Bono in Montreal, said restaurants also struggled during the summer when students took to the streets to protest against the (now former) provincial government’s proposed tuition increase.

“With the city shut down every night, it was a disaster for us for about three months,” Bono said. “Everyone suffered.”

George Pitsikoulis, president of Montreal-based major wholesaler Canadawide, said he’s aware Montreal’s foodservice sales have dropped, but he doesn’t blame black boxes or student strife.

Instead, he sees supermarkets picking up more business.

“I think it’s just changing eating habits,” Pitsikoulis said. “There are more and more prepared foods in retail, even in the smaller independent stores, and I believe this trend has affected foodservice.”